The Guardian, Wednesday 19 August 2009 13.53 BST

Tighter restrictions over the flow of skilled migrants from outside Europe are to be put in place to safeguard the position of British workers at a time of rapidly rising unemployment. It is expected that the recommended changes put forward by the government’s Migration Advisory Committee today will cut the annual flow of 50,000 skilled non-EU migrants into Britain by 5,000 – about 10%. The changes to be implemented under the points-based immigration system will include higher earnings and qualification thresholds, longer advertising periods for vacancies before they can be filled by a migrant and changes to the regime for internal international company transfers.

But the government’s migration advisory committee has resoundingly rejected suggestions that the points-based system should be used to make deeper cuts in the flow of skilled migrants to cope with the turmoil in the British labour market caused by the global economic downturn.

The committee’s chairman, Professor David Metcalf, said the points-based immigration system should act as an “automatic stabiliser and not be constantly adjusted in response to the economic cycle”. He said the changes they were proposing would be put forward regardless of whether there was rising unemployment. “They are not a knee-jerk reaction to the recession,” he said.

The report into the operation of tier two – covering skilled workers – of the points based system was published in response to a request from Jacqui Smith when she was home secretary to examine if there was an economic case for restricting this category to shortage occupations only. This would have cut the numbers by more than 50%.

The report rejects this idea and says there is now a net outflow of non-EU skilled workers from Britain, with more going home than coming here. This is the first time this has happened for many years.

“We believe that selective immigration that favours more skilled workers, as the points-based system does, is vital to ensure that the UK continues to be thought of a good place to do business, invest or study,” said Prof Metcalf. “Therefore in our analysis of tier two our major recommendation is that both the resident market labour test route and the intra-company transfer route be retained. Tier two should not be restricted to shortage occupations only.”

The new restrictions proposed are designed to ensure that the flow of skilled migrants from outside Europe does not involve the undercutting or displacing of British workers or provide disincentive to train them in new skills.

They include extending the period that a job has to be advertised in a local Jobcentreplus from one or two weeks to a minimum of four weeks before it can be filled by a migrant worker. Exceptions are to be made for senior posts in blue-chip FTSE companies.

The introduction of the points-based system has already seen a reduction in the number of skilled workers from outside Europe coming to Britain from 69,000 through the old work permit route in 2008 to an estimated 50,000 this year.

More than half come on “intra-company transfers” such as Honda executives being brought from Japan to Swindon or Indian IT staff working in Britain. The committee recommends several changes to this route, including banning access to citizenship, extending the qualifying period working with the company from six to 12 months and ensuring that the payment of allowances are not used to undercut local labour pay rates.

Home Office minister Lord West said: “The committee has delivered a robust and thorough report and the government will consider it carefully over the coming weeks.”